Macedonia Mulls fate of Key Energy Project

Photo by : ELEM

After two decades of failed tenders, the government sees a last chance for the power project in the bids offered by Greece's Public Power Corporation, PPC, and a Chinese corporation, China International Water&Electric, CWE.

They were the only two companies that last week submitted bids by closing time.

“We need to review the bidding documents, the technical parameters and the financial construction,” said Jasna Davidovic, head of the tendering commission at the Ministry of Economy, which is reviewing the bids.

A source in the ministry said if this latest tender fails and no company is chosen, the ministry plans to hand the project over to the ecology ministry. But some industry insiders say this will drastically decrease its chances of being built.

If both bids pass evaluation, on the other hand, the decisive factor in choosing the highest bidder will be the percentage of shares that they offer the state.
 
This could give the Chinese company an advantage because the same source said it had offered 40.5 per cent of the shares to the Macedonian government as opposed to the Greeks who offered only 28 per cent.

The winning company will build and operate the power plants under concession for 57 years. The company will have 18 months to start construction.

“If the project kicks off, the net effect from its construction alone will increase Macedonia’s annual GDP growth by 2 per cent,” Macedonia’s Vice-Prime Minister in charge of Economy, Vladimir Pesevski, said recently.

Initial estimates say the two dams, which will be the biggest in the country, built on the Crna River in the south of Macedonia, will cost at least €540 million.

They are expected to have an average output of 1,100 gigawatt hours of electricity, matching the production of all the other existing hydro power plants in the country.

This will significantly boost power production in the country, which at the moment has to import up to 30 per cent of its power needs.

Macedonia pushed forward another important energy project in November, when it signed a deal for borrowing €65 million from the European Bank for Reconstruction and Development to construct the Boskov Most hydro power plant near Debar, in western Macedonia. Construction there should start in the first half of next year.